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Aug 12

How to Use Background Checks to Protect Your Business

Reading Time: 3 mins

Background checks have become a standard business practice, and there are many good reasons why you should be using them if you are not already doing so. Background checks are relatively inexpensive compared to the potential costs associated with the risks of not doing a thorough background check on employees, vendors, and contractors.


What to look for in a background check site

A thorough background check will give you information that is crucial in deciding if the person you are hiring is a good fit for your business. There are a variety of online background check companies, such as checkpeople.com, that offer monthly rates for unlimited or nearly unlimited background checks.

The business of online background checks has exploded in the last decade, and it is easy to find one to fit any budget. You should carefully review potential sites to ensure the content they provide is what you will need to make an informed hiring decision. Many sites allow a limited trial period before you commit to a recurring monthly charge, allowing you to decide if it is the best fit for your business. Things to consider when comparing background check sites include:

  • The costs
  • Overall reliability of the content provided
  • Customer service reputation
  • The ease of use of the customer interface
  • Is there an app so that you can do background checks from anywhere at any time


Protection against negligent hiring practices

You can expect to find information about their educational background, work history, and criminal background. Gathering this information is now considered a standard hiring practice, and failing to perform such a check could result in allegations of negligent hiring practices.

A background check should not be the last thing you do before offering a candidate a position. The background check should be the first thing you do for a potential candidate to conserve resources and institute safe hiring practices. Given the low costs of background checks, why not do the background check first before committing time and resources to the rest of the screening and hiring process?

Announcing that a background check will be performed, in an initial job posting, will encourage applicants to opt-out if they assume their background will disqualify for them the position. It also encourages applicants to be more open about their past indiscretions if they assume they will be uncovered anyway. A 10-year-old DUI conviction may not be relevant to the position, but the honesty from your potential candidate is a good starting place.


Provide a safe working environment for your employees

An important reason to conduct background checks is to reduce the risk of harm to an employee, client, or customer. If you hire someone who commits harm against someone else in your company, and the background check would have revealed a history of similar behavior, you could face liability for negligent hiring practices.

Background checks can mitigate the risks of harm associated with:

  • Sexual harassment
  • Violence in the workplace
  • Negligent or reckless driving
  • Substance abuse issues that place others at risk

Conducting routine background checks can also help establish a history of behavior if you are forced to terminate an employee for their conduct, and they file a grievance against you for their termination.

Any history of the above types of behavior should serve as a red flag, depending on the potential candidate’s role in your company. The relatively insignificant costs of background checks pale in comparison to the costs of liability for harm to someone else.


Know the reputation of your vendors

A business depends on a solid working relationship with its vendors to supply goods and services. Finding a vendor with a good reputation for reliability and excellence can be challenging. A background check will provide work history, actions taken against the vendor, and verification of certifications.

A background check before entering into a contract with a vendor will help mitigate the risks associated with damage to your company’s reputation if a vendor fails to deliver their product or service in a timely manner. Your customers and clients rely on you to provide what they need when they need it, and failing to do so because a vendor is unreliable can do significant damage to your reputation.

Vendors can also have substantial contact with your business and pose a security risk. A background check ensures that you are not placing your trade secrets, business model, or your employees in danger by making an unfortunate choice in vendors. Doing a background check on all outside parties who have contact with your employees shows that you take the security of your business and the safety of your employees seriously.


Final thoughts

From employees to potential business partners, there are a number of applications for background checks. The current legal environment makes it easier than ever to sue for negligent hiring practices or other perceived actions that place the safety of your employees or customers at risk. Performing background checks is a simple task that allows you the defense of “reasonable care,” if someone you hire harms someone else.


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